It is not the first time that the Panamanian law firm Alemán, Cordero, Galindo & Lee (Alcogal) has been linked to corruption scandals.
According to the Pandora Papers, a leak of almost 11 millions of documents revealing hidden wealth, tax avoidance and, in some cases, money laundering by some of the world’s rich and powerful people, the small firm has played a prominent role in overseas business start-ups for 200 politicians and people with public office.
During the last three decades, Alcogal has become “ a magnet for the rich and powerful of Latin America ” – and from other parts of the world – who seek to hide their wealth abroad, as shown by the massive leak of company documents obtained by the International Consortium of Journalists Research Institute (ICIJ).
The company served as a business intermediary for more than 117 politicians and public officials, according to the documents.
Among his clients there have been former Panamanian presidents and former high-ranking officials of the state-owned company Petróleos de Venezuela (PDVSA), among others.
Almost half of the politicians whose names appear in the leaked documents had ties to Alcogal, a company founded by Jaime Alemán in 1985, who at that time recruited three other lawyers: Carlos Cordero, Aníbal Galindo and Jorge Federico Lee.
The law firm also has provided services to individuals implicated in some of the most prominent corruption scandals in recent history in Latin America, such as the global bribery operation of the Brazilian construction giant Odebrecht and the international soccer corruption scandal known as Fifagate, as well as the alleged outflow of fiscal resources from Venezuela abroad.
“When we are talking about political elites, presidents or former presidents, they are people who can change regulations, they are people who are benefiting from this system offshore , so you have to ask yourself how this can affect to citizens on tax and transparency issues ”, Emilia Díaz-Struck, ICIJ coordinator for Latin America, tells BBC Mundo.
Maira Martini, washing operations researcher of money from the non-profit organization Transparency International, confirms to BBC Mundo that the clients of the law firm have been related to some of the biggest corruption scandals in Latin America.
H Alcogal, Martini points out, “usually does not ask its clients questions and turns a blind eye in relation to the activities they carry out.”
“Although the Pandora Papers do not prove that Alcogal was directly involved in illegal activities, it raises a red flag for them to be investigated by the justice,” he points out.
“Full compliance with all requirements”
The investigation of Pandora Papers, which is based on more than 11, 9 million confidential documents from law firms and service providers in tax havens, indicate that there is a “shadow economy” that rich and powerful people access.
“Firms like Alcogal boost that economy, helping wealthy clients find shelters to hiding money, sometimes from tax collectors and criminal investigators ”, afi signed by the ICIJ.
In a letter addressed to the consortium of journalists, Alcogal declares that the incorporation of companies “is only one aspect” of its legal services and that it operates in “ full compliance with all the applicable requirements in each jurisdiction in which we work. ”
The company“ carries out in-depth checks due on clients that are considered to be high risk, regardless of the nature of the relationship or the service ”, the letter states.
200 fictitious companies
The leaked documents show that Alcogal established more than 200 fictitious companies in Panama and others jurisdictions at the request of the Private Bank of Andorra (BPA), a private bank based in the small principality located between France and Spain. Some of them were allegedly used to divert funds from PDVSA.
The United States government included the bank on its blacklist as a “main concern about money laundering”.
Most of the companies were dissolved and Alcogal resigned from some of them shortly after the inclusion in that black list was made public in 2013.
The Martinelli family
Also at the request of the BPA, the leaked documents indicate, Alcogal created two companies that were later allegedly used by Odebrecht to channel US $ 30 millions in bribes in order to obtain public works contracts in Panama.
Part of the money went to the children of the former Panamanian president Ricardo Martine lli , as stated by the complainants.
The children were charged last year and prosecutors recommended not Martinelli, who has had personal ties with some of Alcogal’s founders, has long been charged as well.
The Martinelli deny the accusations.
The documents also show Alcogal registered two companies owned by the former president of Panama, Juan Carlos Varela , his brother, his father, and other associates.
When Varela was president, the local press published that part of his campaign was financed with resources from money laundering operations, an accusation that the former president rejects.
Alcogal determined at that time that the case did not require to continue being invest igado.
According to the ICIJ, Alcogal’s founders and partners “are part of the same political class that your company provides services to. They have been in and out of the Panamanian government and political positions for decades. ”
Presidential candidate Nasry Juan“ Tito ”Asfura
Among the operations of the law firm, it also appears that in 2006 registered a company in Panama called Karlane Overseas SA.
The following year, all but one of the 10. 000 shares of the firm were transferred to Nasry Juan “Tito” Asfura, according to the documents.
Asfura, then commissioner of Tegucigalpa, is one of the main candidates for the presidency in the planned elections in Honduras for next month.
The Last year, the Honduran attorney general asked an anti-corruption court to try Asfura, who is now the mayor of Tegucigalpa, for alleged misuse of municipal funds, but the Supreme Court decided not to send the case to trial.
Through a spokesperson, Asfura declared to the Latin American Center for Journalistic Investigation (CLIP) and Contracorriente, partners of the ICIJ, that it does not own the company abroad and that does not have investments in tax havens.
Alcogal indicates that it resigned from the companies identified in the Odebrecht investigation and fully collaborated with the authorities.
Regarding the Andorran bank, the law firm says that it had “ no reason to suspect that BPA Andorra was providing banking services to clients of dubious reputation.”
The connection n Venezuelan
Leaked documents show that the law firm accepted clients referred by BPA to act as the agent in charge of companies abroad of some allies of the late former president of Venezuela Hugo Chávez.
Among them, Javier Alvarado Ochoa and Nervis Villalobos . On 2015, FinCEN, an agency of the United States Department of the Treasury that investigates financial crimes, included BPA in its “black list” for concerns about possible money laundering.
FinCEN claimed that Venezuelan bankers and their clients worked closely with high-level Venezuelan officials and Panamanian agents to establish shell companies that were later used by Venezuelans to “launder looted public funds.”
Following what was indicated by the US agency, Alcogal resigned to continue being the registered agent of some companies linked to Venezuelan clients, the documents of the Pandora Papers indicate.
Ochoa and Villalobos and other Venezuelan officials and some relatives were accused by authorities in Andorra, Spain, USA . and Venezuela.
Neither FinCEN nor other authorities accused Alcogal, like any other service provider connected to former Venezuelan officials.
Villalobos did not respond to the ICIJ’s request for comment, while Ochoa -through his lawyer- declined to refer to his case because it is pending in the courts of justice.
Investigate potential clients
It is supposed to investigate Potential clients is a top priority for lawyers and financial agents.
International legal and banking regulations require professional companies like Alcogal to carefully weigh the risk that they may be inadvertently helping money laundering of money or other crimes before accepting a client.
But sometimes, according to the documents, Alcogal was not sure who He was really the owner of the companies he created. It allowed banks and other companies that sent businesses to hide that information, trusting that they had done a good job of investigating the client.
Alcogal pointed out that does not currently constitute companies , trusts or foundations for a client who does not reveal the identity of the beneficial owner.
“I sleep well at night ”
Alcogal says that it prepares suspicious activity reports in compliance with local legislation.
If you find “negative information” about a company or a client, such as being suspected or accused of a crime, “ we proceed with the course of appropriate action , ranging from obtaining disclaimers to resigning as Registered Agents and / or submitting reports of suspicious activity as appropriate in each case, “the company told ICIJ.
High-risk clients are checked more frequently than low-risk clients sgo, he added.
“We understand that compliance is one of the main pillars of the provision of our international corporate services,” said the firm.
However, statements in the past of the firm’s founding lawyer, Jaime Alemán , show another reality.
During a meeting to make himself known with British Virgin Islands regulators at 2013, according to the information collected by ICIJ, Alemán stated that there were complicated tasks.
“It is impossible to have perfect files,” he explained, according to the records of a meeting on the leaked documents. “We have more than 10. 000 active companies. It is enormously difficult to follow up. ”
Alemán acknowledged that the firm did not have information on the ownership of all the companies that He was already creating those he represented as a registered agent.
Even so, he claimed, he was sure that the firm had most of the requested client information on file.
“ The best proof is that I sleep well at night , even though our files are not perfect.”
Why Panama?
Historically, Panama has been one of the bases of operations for companies that seek to pay lower taxes while protecting their identity.
One of the things that makes Panama attractive “is secrecy , the anonymity with which customers can operate “, says researcher Maira Martini.
“They do not have the obligation to reveal their identity ”because of the way things work in that country.
Although there is an organization of the government in charge of supervising the operations carried out by law firms, in practice, Martini points out, “it does not work.”
“Alcogal helped its clients to open companies abroad and made sure that their names did not appear ”, explains Maira Martini.
“The firm was also supporting some of the banks allegedly involved in money laundering,” he adds.
It is assumed that these banks, says the expert, asked the law firm to open anonymous companies for their clients, without asking further questions .
This way of operating made members of the Latin American elites, he adds, choose to hire the services of the firm.
The Panamanian body in charge of supervising firms that provide services abroad told the ICIJ that the government has taken many “effective and concrete” steps in recent years to fight against tax evasion and money laundering.
(This note was written by BBC Mundo with information based on the revelations made by the International Consortium of Investigative Journalists , including data collection and analysis by Brenda Medina, Jesús Escudero and Emilia Díaz-Struck)
Pandora Papers are a leak of almost 12 millions of documents and files exposing the wealth and secret deals of world leaders, politicians and billionaires. The data was obtained by the International Consortium of Investigative Journalists (ICIJ) in Washington DC and has led to one of the most important global investigations in history. More of 549 journalists from 117 countries have analyzed the hidden fortunes of some of the most powerful people on the planet. The research program of the BBC Panorama and The Guardian conducted the investigation in the UK.
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